Newport Beach Mansion, Once Listed for $57 Million, Sells at Auction

This property in Newport Beach, Calif., has sold for a fraction of its initial list price.

An unfinished, 16,600-square-foot mansion in Southern California once listed for $57 million has sold at auction for just $18.5 million, according to the property owners’ lawyer.

Located in the upscale city of Newport Beach, Calif., the mansion was last listed for $37 million before being brought to auction in the last week of April. If the deal is accepted by all parties, including the lender and a list of subcontractors, the sale will draw to a close one of the most ambitious homes to break ground in Orange County during the housing boom. The buyer has not yet been revealed.

The property includes a private lake, a horse stable and riding area, a 17-car garage, a private vineyard and a “wine cave,” among other amenities.

In 2003, well-known real-estate agent John McMonigle formed a limited partnership to buy the 12.5-acre parcel of land for $3.42 million, according to attorney Sean O’Keefe, who represents the current owners. Mr. McMonigle did not return calls for comment, and he is no longer represented by Mr. O’Keefe. Mr. McMonigle’s current attorney, Michael Nicastro, declined to comment on the sale.

To build the colossal eight-bedroom, 17-bathroom estate, the partnership took out several loans against the property, including a $21.6 million loan in 2007 from La Jolla Bank, according to court records. The Wall Street Journal has reported that La Jolla Bank, which had a large concentration of residential real-estate loans, was shuttered by regulators in 2010 as the housing crisis reverberated.

By early 2011, One West Bank, which had acquired the loans, filed for foreclosure on the property, according to court records. The owners then filed for Chapter 11 bankruptcy protection; Mr. McMonigle left the partnership shortly before the filing, according to Mr. O’Keefe. Corey Gulbranson, a current managing member of the partnership selling the property, said Mr. McMonigle resigned, but would not comment on his reasons.

The auction was held with an undisclosed reserve price, which represented a settlement among the property owners, the lender, and a committee that represents the property’s more than 200 creditors, Mr. O’Keefe said. In addition to the $18.5 million sales price, the buyer will pay a 5% premium to the auction company, Auction.com.

After the sale, Mr. Gulbranson said “everyone seemed satisfied with the outcome.” Mr. Gulbranson would not name the other members of the partnership.

Still, the deal must still be finalized in court. The property is still unfinished, and listing agent Rob Giem, of HOM Sotheby’s International Realty, estimates that the buyer will have to put in another $3 million to complete the original plans for the property. He said the home is about “90% to 95%” complete.

The most expensive sale in the Orange County area was for $35 million on a Laguna Beach property in 2008, according to the county tax assessor’s office.